Mr. OTB, yes you are right that I have not included the potential earnings to be earned from RE generation supplied to the data centres at Kulai. I have highlighted this in an earlier note that once YTLP installs solar power at the Kulai DC park, its data centres will be able to save on electricity costs which I assumed at over 50 sen/kWh to be supplied from the grid. Potential saving on electricity costs may amount to few hundred million ringgit a year based on the current solar panel prices.

https://www.theedgesingapore.com/news/energy/work-begins-ytl-corporations-800-mil-600mw-hydrogen-ready-combined-cycle-gas-turbine

This new 600MW hydrogen-ready CCGT in PowerSeraya to be commissioned by end of 2027 will contribute about RM700 million of net profit a year from 2028 to YTL Power based on my base case assumptions. If green hydrogen fuel costs can drop by half in next 5 years as projected by some international energy experts, the potential profit margin from this 600MW CCGT will be higher. At the start, it will be 50% hydrogen capable upon completion. It can be retrofitted to achieve 100% hydrogen-readiness in the future.

Meanwhile, this new CCGT project will provide S$800 million worth of construction work to YTL Corp as it is the turnkey contractor to carry out this job for next 3 years.

I suspect the selling was done by call warrant issuers to depress down the share price ahead of the expiry of 4 call warrants this month end, but I may be wrong.

Mr. OTB, now I see where you are coming from. You were thinking that out of the planned 500MW solar power farm in Kulai, 100MW would be used for RE export to Singapore, 150+80MW would be used to power the secured 230MW AI data centres, 20-30MW reserved to power the 32-40MW colocation data centre with SEA Ltd, so there would be some 150MW of solar power capacity left for RE export to Singapore.

But it does not work that way for RE export to Singapore.

Firstly, the 668ha of site at Kulai is sufficient to install a max of 500MW of solar power. That's enough to power up at best 250MW of AI data centre with battery solutions. That is because solar power can generate electricity for 4 to 6 hours a day in general, so it takes at least double the size of solar power peak capacity to power up the AI data centre of certain power load, eg. you need to install at least 200MWp of solar power plus big battery storage in order to power up a 100MW AI data centre, with 100MW of electricity generated during the day when sunlight is available at the strongest for 4-6 hours, then 100MW x 3 times of battery storage to continue the power supply to the data centre for another 12-18 hours of the day, with the balance supplied from the grid. I think you need to have RE to power up the AI data centre for about 20 hours a day minimum to qualify for a green data centre.

Similarly, for RE export to Singapore, the EMA will specify continuous supply of the RE at certain capacity or at least 16 hours/day of RE supply during the peak demand periods of electricity demand in Singapore. So for a 100MW of RE export to Singapore, we will need solar power installation of about 400MWp with at least 300MW of battery storage in order to supply minimum 16 hours a day of RE supply.

For the pilot project of 100MW solar power export to Singapore that YTLP has secured from Singapore EMA, YTLP is having a temporary arrangement with Tenaga to supply the required RE to Singapore, until YTLP installs sufficient solar power at a new site in Malaysia. It is awaiting the details of the Third Party Access (TPA) to be finalised before it decides where to install the solar power farm, I think.

I have gathered info that YTLP has secured some sites in the northern region of Peninsular Malaysia as sun intensity is the highest in the northern region.

@xiaoeh, I have bought a lot of YTL Power at around RM0.70 in the first batch, then added more at RM1.10-1.40. I did sell a little bit at prices from RM5.00 to RM5.30 for those lots I bought at around RM1.10 for the first 5-bagger gain.

For those lots bought at RM0.70, I am still holding and plan to hold till I get a 10 bagger from it, i.e. when YTLP share reaches RM7.00 expected by FY2026.

If RE export quantity is for 150MW based on solar power, then the projected net profit for YTLP would be RM338 million a year as you highlighted above. But I tend to stick to the more conservative of the 100MW RE pilot program continuing into 2026.

Mr. OTB, in my earnings projection for YTL Power, I still assume that there will be 100MW of RE export to Singapore continuing after the 2-year pilot program, based on installation of some 500MWp of solar power at a Johor site with battery solutions, and an average electricity selling price of SGD170/MWh. So I have projected a net profit contribution of RM225 million from this RE export to YTL Power from FY2026 onwards flat for at least 10 years to 2035 when more RE import to Singapore is expected.

The selling this morning was due to disappointment of some short term traders on the lack of HOC and Madani Deposit scheme in Budget 2025, even if these schemes were announced at the budget tabling, I suspect these short term punters would have sold on news anyway.

It is good to flush out the short term punters whose selling has been quickly adsorbed by longer term investors.

Even though HOC and Madani Deposit scheme were not announced during the budget tabling last Friday, it is not all lost. There are other measures which are positive for the property sector.

In particular, the government guarantee of RM12.8b has enabled some 57,000 first-time home buyers to obtain necessary financing to purchase their first house under RM500,000.

The government announced an extension of another RM10b to enable at least another 20,000 first-time home buyers to get home loans to purchase houses priced up to RM500,000.

These two initiatives will enable easily 80,000 first-time home buyers to buy their first house, and will help to clear the outstanding inventory of at least 80,000 units of overhand properties.

In addition, the Step Up Financing Scheme under SJKP offers a government guarantee of up to RM5.0 billion for young people purchase their first home. The scheme provides lower repayment options for the first 5 years to ease their financial burden. Assuming a guarantee amount of averaged RM100,000 per buyer for the first 5 years of lower instalments, this scheme will benefit another 50,000 young home buyers.

All these schemes above aim to address the issue of difficulty in getting financing for young home buyers due to low monthly salary at young ages or instable monthly income.

https://www.thestar.com.my/business/business-news/2024/10/17/uk-water-regulator-mulls-boosting-investor-returns

https://klse.i3investor.com/web/blog/detail/savemalaysia/2024-10-17-story-h471865730-All_for_HOC_s_return

The return of HOC will be great news for most property developers including IOIPG

https://klse.i3investor.com/web/blog/detail/mercurysec/2024-10-17-story-h471865917-AEON_Co_M_6599_Revisiting_52_week_High

Technical Buy from Mercury

https://klse.i3investor.com/web/blog/detail/rhbinvest/2024-10-17-story-h471865949-AEON_Co_M_On_Course_for_a_Record_Year_Stay_BUY

Good report from RHB

UK inflation softened further to 1.7% in September from 2.2% in August 2024. This argues well for further interest rate cuts by BOE in coming weeks.

Rate futures are pricing in 90% chance for two times 25-bps cuts by BOE by end of the year, up from 80% earlier.

Wessex will stand to benefit tremendously when rates are cut by another 0.5% by year end to bring total cuts to 0.75% then. With about GBP1.0 billion of floating rate debts, Wessex will stand to save GBP7.5 million in interest expenses in 2025 just from these 3 cuts of 0.75%. US Fed "dot plan" now indicates to a total of 100 bps cuts in 2025 for the US, BOE may follow suit closely.

This means Wessex will save interest expenses of GBP17.5 million in 2026 which will bump up its earnings contribution to YTL Power by about RM100 million in CY2026 and beyond.

https://klse.i3investor.com/web/blog/detail/dragon328/2024-10-09-story-h470999089-IOIPG_Multiple_Re_Rating_Factors_in_Coming_Months

@myloh123, read the article above again. I have already given enough hints there.

Another good closing today!!

Looks like some good news is indeed coming soon as @Nadayu said.

Superb closing!!

Well done @myloh123.

The lowest I got was RM1.79 on 6 August.

UncleFollower, you are chun chun. I missed to add after happily collecting the 5 sen dividend.

https://www.thestar.com.my/business/business-news/2024/10/15/singapore-economy-grows-41-in-3q-on-manufacturing-rebound

Singapore electricity demand has strong corelation with the GDP growth. The strong 4.1% growth in GDP in Q3 bores well for electricity demand growth in Singapore in July-Sept 2024.

That reaffirms my earlier checks for retails margin in Singapore electricity market in July & August. A 1% additional demand growth translates to over 70MW of additional peak demand for electricity supply.

https://www.thestar.com.my/business/business-news/2024/10/11/surge-in-spore-luxury-market-a-boon-for-ioiprop

On the other hand, Hong Leong research issued an update report on IOIPG this morning. There are plenty of good news in recent developments in Singapore as highlighted in the report.

Anyone interested in getting the report, pls pm me

IOIPG released its Annual Report 2024 yesterday. There are several pleasant surprises in CEO Lee's key note address:

1) IOIPG plans to launch over RM5 billion of properties in FY2025 (ended 30 Jun 2025), surpassing FY24's RM4.49 billion of launches.

2) Property development segment will also witness launches in existing industrial parks. In addition, there will be an introduction of a new industrial park in Melaka in FY25.

3) Spread over 322 acres, IOI Industrial Park @ Banting is expected to launch some 50 units of cluster, detached and semi-detached factories in FY25 itself, which is sooner than expected

4) IOI Industrial Park @ Iskandar Malaysia will increase its acreage to 1,107 acres, more than double of the earlier 500 acres allocated due to strong demand

5) The acquisition of Tropicana Gardens Mall will be finalised and begin contributing to IOIPG earnings as early as Q1 CY2025, in conjunction with the seasonally strong year end and CNY festive periods

6) IOI BUsiness Park in Xiamen, CHina will begin its initial contribution in FY2025, as business environment started to get a big boost from Beijing stimulus measures

7) IOI Central Boulevard towers in Singapore will begin initial contributions in FY2025, with tenancy rate increased to 60% now from 50% as of 30 Jun 2024. This is a major positive catalyst

8) Total net lettable area (NLA) of IOIPG's four malls stood at 4.34 million sq ft in FY24, is set to increase to 5.39 million sq ft in FY25 with the addition of Tropicana Gardens Mall. This paves the way for setting up a commercial REIT soon

9) Total NLA of IOIPG's six offices stood at 4.43 million sq ft, which I presume has included the 1.29 million sq ft from IOICB. This is sizable and ripe for injection into a commercial REIT when tenancy rates mature

10) The hospitality and leisure segment will get a boost in FY2025 with contributions from the acquired 199-room Courtyard by Marriott Penang which was completed in July 2024, and the commencement of the 370-room Sheraton Grand Xiamen Jimei slated for completion by Q2 FY2025 (Dec 2024).

11) Inclusive of the 634-room JW Marriott Hotel Singapore South Beach, total hotel rooms of IOIPG will increase to 3.075 rooms (of 9 hotels) by Dec 2024, which is sizable for injection into a hospitality REIT

12) The new luxury hotel in Langkawi and the new 350-room W Singapore - Marina View are scheduled for completion in 2028

Furthermore, the inflation effect on YTLP's subsi business will partly offset the negative FX impact, eg. Jordan Power PPA has got inflation adjustment in the O&M cost recovery component and mining operating costs component, an 5% CPI/PPI rate will partly offset the 10% weakness in USD.

Another example is that when crude oil prices rise, the generation costs in Singapore electricity will rise in tandem, as most of the generators there are CCGT that burns PNG or LNG, both are linked to crude oil prices. Hence, USEP and wholesale prices / retails prices will all increase proportionally. Often there is a lag effect in the increased gas costs to the increase in retails prices, as the gas costs are based on forward gas/oil prices but retails price may be raised immediately for the following months the next day when retails contracts are signed. Gencos will always priced the retails prices slightly higher when oil prices increase, hence there is always an additional hidden margin when retails prices are adjusted. Both steps will have positive effect onto Gencos' margin, which will partially offset against the negative FX impact.

Furthermore, Bank of England is ready to cut rates further after the jumbo rate cut by US Fed in September, and this will help to lower interest expenses of Wessex substantially. A 1% rate cut will help Wessex to save some GBP10m of interest expenses a year as it has about GBP1.0 billion of floating rate debts. Lower fund rates will help Wessex tremendously in next 5 years as Wessex embarks on its massive capex programmes and will be able to raise new debts at much lower rates. A 2% rate reduction in new debts issuance of GBP2.5 billion will help save a massive GBP50 million in interest expenses every year. That will be more than offset the 3% impact from the strengthened ringgit against the pounds.

Mr. OTB, good calculations above. Your projected earnings from the AI data centre business is more or less close to my earlier calculations though I was using an assumed leasing rate of just USD2.50 per hour per GPU.

You are probably right that the leasing rate has moved up substantially, especially after Blackwell was introduced and the pricing of Blackwell is higher than the Hopper series. My earlier assumption of US$2.50 per hour per GPU now looks too conservative.

On another note, I notice that some parties have overplayed the currency fluctuation effect on YTLP earnings. It is good that you have used a conservative assumption of 10% impact from FX, but I won't expect that much of an impact in reality.

FYI, USD has since strengthened to above RM4.35 and SGD has strengthened to RM3.285 today, which is less than 5% impact from my earlier assumption of SGD1.00 = RM3.45.

I won't be attending this AGM/EGM as it is far away from my base town, but for those staying in the Klang Valley, it may be good to attend it so as to get first hand info from CEO Lee on any good news or good progress in the Singapore projects. Anyone attending it pls do report the main take-away points to us who are not able to attend.

To me, this is all good to IOIPG as the project manager as it will not need to come out with equity money to fund the project, but instead will receive fees for managing the project.

During pre-development period, IOIPG will receive total fees of SGD195,000 per annum

During the Redevelopment Phase, IOIPG still stand to receive total fees of 2.65% of total construction costs, or 2.65% x SGD600 million = SGD15.9 million during the 4-year construction period

During Post Development Phase, IOIPG will stand to receive management fees of 3% of Gross Revenue estimated at SGD68 million a year when fully tenanted, i.e. 3% x SGD68m = SGD2.0 million a year

IOIPG just made a circular to shareholders during lunch break. I summarise the salients points as below:

- The main point for the EGM is to seek shareholders approval for IOIPG to participate in the Shenton House redevelopment project
- IOIPG management has earlier rejected the offer by CEO Lee to take over the Shenton House project due to capital commitment which would increase IOIPG net gearing from 0.68 to above 0.90x
- Instead IOIPG management has entered into a Management Agreement with Shenton 101 to manage the redevelopment of the project and act as exclusive agent , without equity commitment
- The entry into the
Management Agreements seeks to address the decision-making process regarding
matters where LYS has a potential self-interest or situations that may impair his ability
to perform his role as the Group Chief Executive Officer of IOIPG in an objective and
impartial manner. The terms of the Management Agreements provide IOIPG Group
with the ability to direct the manner of the development and management of the
Property in a way which manages potential competition between the business of the
IOIPG Group and Shenton 101 and will form the basis of a governance structure to
manage the Potential COI, notwithstanding that the IOIPG Group does not hold any
equity interest in Shenton 101.
- Under the terms of the Management Agreements, the IOIPG Group has been granted
a right of first refusal to have the priority right to acquire or match any third party offer
if (i) Shenton 101 were to seek to dispose of any part of the Property (including any
developed units/properties) or (ii) LYS were to seek to dispose of any part of the equity
interest held by him in Shenton 101 or (iii) Shenton 101 or LYS were to enter into any
joint venture or joint development or other disposal or transfer arrangements. The right
of first refusal is valid throughout the redevelopment period of Shenton House (which
is anticipated to end by the first quarter of 2031 based on the current redevelopment
schedule) or a period of 7 years after the date of the Management Agreements,

- Multi Wealth shall take conduct of the co-ordination, superintendence and supervision of the Project
at the cost and expense of Shenton 101, and Shenton 101 appoints, authorises and empowers Multi Wealth to manage the day to day operations of the Project
- During the Pre-Development Period, Wealthy Link (IOIPG subsi) will be paid a fee of SGD140,000 a year for Pre-construction business coordination and facilitation services + a fee of SGD53,000 a year for interim accounting and corporate support services
- During the Redevelopment Phase, Wealthy Link shall be paid for construction management services a fee which is equivalent to 2.2% of the total construction costs + a fee equivalent to 0.45% of total construction costs for interim accounting and corporate support services
- During Post-Redevelopment Period, Wealthy Link shall be paid a fee equivalent to 3% of Gross Revenue (all rental income to be received by the Redeveloped Shenton House) for provision of management services, and
- where Wealthy Link provides property management services in respect of or in
connection with the lease administration of the Redeveloped Properties (for both
new lease and lease renewal), a leasing management fee of 0.25 month’s gross
rent

YTL and YTL Power had taken almost 2 years to give me a 7 bag (from RM0.70 in May 2022 to a high of RM5.40 in May 2024). I would be happy if IOIPG could double up in one year by June 2025, from my initial recommendation in July 24 at price of around RM2.10.

For IOIPG to return a 5-bag return, it will take years and will need IOIPG management to undertake active corporate exercises to unlock its vast assets.

NO need to thank me. You should thank IOIPG top management and the CEO.

Ahead of the AGM and EGM on 7 November, I expect IOIPG to announce some good news progressively in the weeks ahead or at the AGM itself. For shareholders to vote for the proposed participation of IOIPG in Shenton House redevelopment project as the exclusive marketing agent and project manager, CEO Lee may need to announce some good news or good progress in its property projects in Singapore.

https://klse.i3investor.com/web/blog/detail/dragon328/2024-10-09-story-h470999089-IOIPG_Multiple_Re_Rating_Factors_in_Coming_Months

You may refer to my article above in which I have incorporated the recent developments at IOIPG and some updates from IOIPG investor relation chief.

Right, Blackrock must have confidence in YTL group for it to partner YTL in this purchase of property project in Singapore CBD. YTL will take a minority stake as reported. Blackrock, being one of the largest funds in the world, could have taken the entire stake in the project which costs around S$290m only, which is not a big sum to Blackrock.

But Blackrock chooses to partner YTL as it believes YTL will be able to add value based on its long track records of buying undervalued assets and turning them into cash cows, just like the Niseko resort land.

The upcoming 2024 Budget may have major good news to IOIPG and property developers, if the proposed Madini Deposit scheme is approved.

IOIPG will be able to tweak its property offerings in IOI Resorts City and in Taman Putra Kulai and roll out properties below RM500k to qualify for the Madini Deposit scheme. New launches of affordable apartments and single storey terrace houses at price below RM500k will be well received as 1st time home buyers will surge when the upfront deposit is subsidised by the government. Furthermore, the recent pay hike of 17% for civil servants will increase the disposable income of these groups of buyers/consumers by at least 30%-50%. This will spur footfalls and spending at IOI City Mall and increase buying interests in IOIPG property offerings at IOI Resorts City.

The large tract of undeveloped land of 3,480 acres in Kulai will ensure plenty of room for IOIPG to increase its offerings to industrial demand especially data centre players. With the completion of RTS and implementation of JB-Singapore Special Economic Zone measures, more and more industrials will move into JB and hence IOIPG's Industrial Park at Iskandar will see good take-up rates for its offerings of semi-detached and detached factory lots in next 2-3 years.

@Investorr, IOIPG has high NTA of RM4.00 per share, and RNAV of RM6.00 per share. Hence IOIPG is trading at just 0.45x book value.

In comparison, Eco World is trading at 1.05x book value, Mah Sing is trading at 1.02x book value.

Retails margin should stabilise at around SGD60/MWh or slightly higher if demand picks up towards January. It will not collapse like some sell-side analysts are trying to project. Vesting non-fuel margin is already close to SGD60/MWh due to inflation in capex, opex and land costs, hence the non-contestable customers are paying this rate for electricity supply by MSSL.

Indications on the ground in the months of July and August show that PowerSeraya should be on track to beat my earnings projection of S$170m net profit for July-Sept 2024 (Q1 FY2025) quarter.

This will offset against the strong ringgit as of 30 Sept 2024. SGD has since rebounded to RM3.28 lately, due to lower expectations for another 50 bps rate cut by US Fed in November after a strong non-farm payroll data recently.

As I said earlier, the electricity supply in Singapore is still tight as there is no new capacity in past few years, while electricity demand is creeping up due to new data centres (at least 50-100MW increase every year), higher industrial activities after COVID, EV charging and occasional heat wave.

USEP will spike up for few hours every now and then whenever there is spike in demand, or when there is a combined-cycle gas turbine on maintenance, or tripped off.

@Nadayu, yes I also think that some good news is coming, it can be a land disposal to a data centre player, or good take-up rates at its recently launched industrial parks at Banting or Kulai, or simply good sales at its property projects.

IOIPG's commercial property offering in the heart of Bandar Puchong Jaya, Skyloft Avenue, has seen its ground floor units 100% sold out, with only limited offices left.

Its high-rise condo project GEMS Residences at IOI Resort City are selling like hot cakes.

Mr. OTB, the hyperscaler has taken up 80MW of AI data centre at YTLP Kulai DC park.

SEA Ltd has taken up 40MW of colocation data centre (without AI), the balance 8MW at this colocation data centre (DC1) is to be reserved by YTL Comms / YTL AI Lab for promoting local AI apps development.

@Permutation, I have not heard any confirmed deal between Oracle and YTLP re leasing the AI data centre in Kulai, though they may be talking to each other as YTLP's Kulai DC park offers one of the cheapest and fastest way for Oracle to roll out its AI cloud services in Malaysia.

Until I read any confirmation of the deal, I am keeping my forecast net profit of RM3.75 billion (EPS of 46.2 sen) for FY2025 and RM4.71 billion (EPS of 58.1 sen) for FY2026, having included earnings contribution from data centres with SEA Ltd, Nvidia and a hyperscaler.

https://theedgemalaysia.com/node/728229

Malaysia data centre market is expected to grow 383% in next few years.

Jordan Power venture is seeing higher profits every year due to the inflation clauses in the Power Purchase Agreement (PPA), Operations & Maintenance (O&M contracts and mining contracts, which will negate the negative impact of a weak US dollars.

https://www.express.co.uk/finance/personalfinance/1953290/bank-of-england-cut-base-rate-boost

Wessex earnings will get a boost once interest rates in the UK are reduced as per the above article envisages.

Wessex had about GDB1 billion of floating rate loans as of June 2024. A 1.5% reduction in in interest rates will save GBP15 million or RM87 million of interest expenses for Wessex a year. That will negate the negative impact from strengthening ringgit against the pounds.

Whatever naysayers may say, PowerSeraya earnings have beat expectation in past 6 quarters, and it will continue to be strong in next few quarters due to very tight electricity supply situation in Singapore.

The prevailing low wholesale prices in Singapore electricity market in past few months are due to price dumping by one genco who has secured some extra spot gas supply and wants to pump up its generation share ahead of a partial sale of its equity stakes to Sembcorp.

The temporary surplus gas supply situation is largely over and I expect retails margin to pick up again in following months, with good signs seen in early September.

The issue of fat profit margin of PowerSeraya due to some cheap gas secured for 2 years has been overblown by certain sell-side analysts. In fact, there was no mention of PowerSeraya earnings boosted by cheap gas supply in the quarterly result reports for past 6 quarters since Jan 2023. Some sell-side analyst might have intentionally or unintentionally mistaken the words of YTLP IR chief during one of the result briefing call.

PowerSeraya's strong earnings over last 1.5 years have been driven by tight electricity supply situation in Singapore with the reserve margin dropping towards the minimum of 27% in several occassions.

Based on EMA's projections in its consultation paper dated 31st July 2023, the peak demand growth was so strong that the reserve margin was projected to drop to 32% in 2023 in the base case and 26% in the high growth case, 27% in the base case and 23% in the high growth case in 2024, and to 27% in the base case and 24% in the high growth case in 2025.

With no new generating capacity coming out in Singapore until 2026, the reserve margin will get tighter in coming quarters due to strong electricity demand growth from new data centres, EV charging and hot weather.

It is only logical for electricity retails margin to go up in a tight electricity demand situation. As for the absolute wholesale prices, it is affected by both the crude oil prices and FX. As crude oil prices and US dollars have both dropped in recent weeks, wholesale prices will reflect the lower prices in SGD/MWh.

@Permutation, FY2024 EPS is already announced to be 42.7 sen, done.

For FY2025, I am looking to revise downwards the net profit projection for YTLP by RM150-200m due to strengthening ringgit, to about RM3.6 billion or EPS of 44 sen.

For FY2026, I am still looking at net profit of RM4.7 billion or EPS of 58 sen.

That's my best guess for now.

Looks like business rivals of YTL have not given up so easily to tarnish the name of the group, but the real money bet was in the short selling. We are not seeing much short selling lately on YTLP and most of the short selling positions have been closed when the share price dropped towards RM3.30.

MACC was supposed to investigate on the last payment claims in the 1Bestarinet project to see if there is any corruption issue involved, and they have found nothing wrong. Now they switch to checking on data quality in the 8,000 schools? That has been checked and cleared by the parliament PAC few times. Firstly I am not sure if that is under the scope of MACC as it only involves the quality of services delivered under government contracts which come under PAC, secondly I believe YTL Comms has delivered everything required under the 1Bestarinet project based on contract specifications, nothing more nothing less, and has not earned anything from this project award.

This is seen as the last desperate move by business rivals to tarnish the name of YTL group when more mega government contracts are to be dished out in coming months.

I believe YTL will emerge unscratched from this episode.

@Beta Ipoh, good for you to have been holding onto YTL Power for 10 years. You should thank yourself for the perseverance and faith in the company, to have held it through the worst period of the company in 2018-2020 when the share price dropped to below 70 sen, and withstand the temptation to lock in profit when the share price had jumped up 100% to RM1.40 or 400% to RM3.50. You are being rewarded for the patience and long term investment mentality.

Having said that, I hope you now have a better understanding of the company's various businesses, the earnings prospects and the challenges faced by each subsidiary, and are in a better position to evaluate the best time to lock in profits, or to hold on for many more years to collect dividends, whichever way to suit your investment and financial needs.

The EGM is proposed at the request of CEO Lee for IOIPG shareholders to vote on the proposed participation of IOIPG in Shenton House redevelopment as the exclusive marketing agent, rather than as the developer. I see no reason not to vote for the proposal, as IOIPG will not need to fund the redevelopment of Shenton House but can still participate in this development and earn some commission and management fees. The more important thing is that IOIPG being the exclusive marketing agent can time the Shenton House products and launching time so as to avoid conflicts of interests and competition with its own IOI Central Boulevard office towers.

There is a good chance for IOICB to ramp up tenancy from 50% to 80% by year end and further to 95% by June 2025. By that time, IOICB will be profitable as interest expenses will have come down substantially after a projected rate cuts of 150 bps by June 2025.

Shenton House redevelopment could start in FY2026 after IOICB achieves over 90% tenancy and complete by FY2028. Then IOIPG will have sufficient cashflows (from substantial rental income from IOICB and sales from Marina View Residences, and reduced interest expenses) to participate as an equity partner or take over the project as initially envisaged. I think the timing will be just right then, but it is not the right time now for IOIPG to take over Shenton House. So I feel IOIPG top management and CEO Lee has been considerate and visionary.

After IOICB achieves over 90% occupancy, IOIPG may consider listing it up in a commercial REIT in Singapore to reduce gearing, and get back substantial funds (>S$2.0 billion) to help fund the redevelopment of Shenton House from FY2026. Once Shenton House is complete in FY2028 and achieves tenancy above 90%, it may then be injected into the Singapore commercial REIT to get back the invested money of at least S$1billion.

https://www.thestar.com.my/business/business-news/2024/09/25/new-sfz-incentives-to-buoy-forest-city

IOIPG is one of the top picks of UOB research, for its increased launches and large Johor landbank.

Yet the share price is suffering from persistent selling from certain parties for some reasons not known to me.

Anything that can be quantified is not a big risk to me, for instance FX movements.

It will be more risky if FX movements or any commodity price movements will cause a big dent to the underlying business profitability, i.e. aluminium price movements to Press Metal, or crude palm oil price movements to plantation companies. These are the companies that I will not invest in, taking heeds from Buffetology.

@Beta Ipoh, you have asked this question repeatedly and I have answered before. Not sure of your motive or just scared. Again I will say that the strengthening ringgit will make YTLP's overseas' subsidiaries' profits to be lower when translated into ringgit terms.

For example, PowerSeraya's projected net profit of S$170m for Q1 FY2025 would be translated into RM552 million at FX of RM3.25 to SGD1.00, a 6% reduction from the earlier figure of RM586m at FX of RM3.45. That's all and full stop.

More important is the underlying business operations, not the currency fluctuation. The businesses of YTL Power are all fully hedged against currency fluctuations, eg. fuel costs of PowerSeraya are fully hedged against FX and crude oil price movements.

YTL Power may not benefit from the strengthening ringgit, but rather the cooling inflation and lower interest rates in the UK, and tighter electricity supply in Singapore in next few quarters to 2026. These effects will have positive impacts on YTLP's overseas subsidiaries with potential earnings upgrade of over 5% which will negate the strengthening ringgit.

Early signs are pointing to better profits than the earlier assumed S$170m for PowerSeraya in Q1 FY2025. I am looking at a potential S$180m net profit in Q1, which will translate to RM585 million again even at FX of 3.25.